Entrepreneurism & The Corporate Perspective (Pt. 1)

Introduction
A very successful businessman had a meeting with his new son-in-law. "I love my daughter, and now I welcome you into the family," said the man. "To show you how much we care for you, I'm making you a 50-50 partner in my business. All you have to do is go to the factory every day and learn the operations." The son-in-law answered: “I hate factories. I can't stand the noise." "I see," replied the father-in-law. "Well then you'll work in the office and take charge of some of the back office operations." "I hate office work," said the son-on-law. "I can't stand being stuck behind a desk all day." "Wait a minute," said the father-in-law. "I just made you a half owner of a profitable corporation, but you don't like factories and won't work in an office. What am I going to do with you?" "Easy," said the young man. "Buy me out!!!"

Entrepreneurism is most often associated with small and medium-sized businesses. Yes, we know of small businesses who rode entrepreneurial ideas into large and profitable companies. But most of the time we view entrepreneurs to be small business owners. It is my goal to challenge that thinking. Entrepreneurism not only births large corporations, large corporations give birth to entrepreneurial innovation. In fact, this is the first of eight myths related to innovation in a corporate environment that I want to address. For purposes of this presentation, I will be heavily drawing from material/ideas in Vijay Govindarajan and Chris Trimble’s work entitled: “The Other Side of Innovation.”

Myth #1 -- Only Start-ups Can Innovate
The reality is that many innovation challenges are out of reach for start-ups. Many innovation challenges can only be tackled by large and established organizations. Why? It is because organizations have mammoth assets at their disposal, assets that entrepreneurial firms can only dream of. As such, those of you with an entrepreneurial bent should be open to joining large organizations.

Myth #2 – Innovation is All About Ideas
There are more than 10,000 climbers each year who attempt to reach the heavily glaciated summit of Mount Rainier in the Northwest. It is perhaps the world’s most difficult climb that is accessible to novices, so long as they are accompanied by expert guides.

The first hour of the climb is easy. Each subsequent hour is harder. At dawn, the climbers get their first glimpse of the summit – majestic and inspiring. With each step, however, their labors become more excruciating. Muscles ache. The air becomes thinner. Some of the climbers become dizzy. In fact, nearly 50% of those that start out, turn back failing to achieve the summit. For those that persevere, the summit brings jubilation and exhilaration. Months of preparation comes to fruition. To be atop Mount Rainier is to sense that you are on top of the world. The city of Seattle lies more than fourteen thousand feet below.

But their adventure has only begun. They still have to get back down. And the descent from Rainier’s summit is actually the most difficult part of the expedition. Climbing a flight of stairs may be harder than descending but this is not the case with a descent from Mount Rainier. It is a dangerous mountain, one that claims a few lives each year. The snow on the surface of the glacier can collapse into interior caves and tunnels, and climbers can slip into deep crevasses. As each hour passes, sunlight and rising temperatures soften the snow and increase the risk. Added to these risks is the fact that climbers are deeply fatigued and prone to mistakes. No matter how many times they are told of the dangers in advance, climbers naturally relax at the summit. The glamorous part of the quest is over. The big aspiration – the big dream – has been fulfilled. The trip down is an afterthought.

There is a Rainier-like summit in entrepreneurism. It occurs when an organization says yes! That’s a great idea! Let’s take it to market! Let’s make it happen! Getting to the summit can be difficult. The challenge of reaching the summit lures many. It captures the imagination. It is easy to get others excited. Getting to the summit can seem like the fulfillment of a dream, but it is not enough. After the summit comes the other side of entrepreneurism – the challenges beyond the idea – execution.

Entrepreneurs tend to place too much emphasis on ideas and not nearly enough emphasis on execution. Thomas Edison said: “Genius is 1 percent inspiration and 99 percent perspiration.” As an entrepreneur in an organization, innovation is not just about an idea. You need to encourage your organization to shift more attention to the other side of innovation – execution.

Myth #3 – Entrepreneurs Who Are Also Great Leaders Never Fail
Where you find an overemphasis on great ideas, you often find an overemphasis on great leaders. Many organizations hold romantic views of entrepreneurial heroes. Even those organizations that are unmoved by exaggerated tales of inspired underdogs overcoming long odds, can be tempted to embrace stories about how great leaders are able to always implement great ideas.

This is simply not true. While not dismissing the importance of choosing the right innovation leader, choosing a talented leader is never enough. This is because innovation and ongoing operations are always and inevitably in conflict. What do I mean? The greatest strength of a successful organization is repeatability and predictability. By definition, innovation is neither repeatable nor predictable. It is exactly the opposite. It is non-routine and uncertain. Thus, the inherent conflicts between innovation and ongoing operations are simply too fundamental and too powerful for one person to tackle alone. Entrepreneurs who are also great leaders need the support of the organization and assistance from its resources to have any chance of being successful.

Myth #4 – Effective Entrepreneurs Must Be Rule Breakers
Entrepreneurs are called risk takers, mavericks, and rebels. The fact that innovation and ongoing operations are inevitably in conflict makes it easy to create a mythical drama. What will our hero do? What obstacles will our hero have to overcome? Who in the big organization is our hero’s arch villain?

This romantic story usually results in our hero overcoming the stubborn forces arrayed against innovation by “breaking the rules.” It is important that you don’t want to let this notion take hold in your organization. This is because:
o Innovation leadership is not best thought of as civil disobedience. The odds are stacked against rebels and mavericks. Moreover, an organization full of rebels and mavericks fighting the system is not an innovation powerhouse -- it is an undisciplined and chaotic mess.
o Innovators need the organization. Innovation may very well signify the future. But the successful organization is the proven foundation, and if it crumbles, there is no future.
o Conflict is not due to the organization being evil, rather, it derives from the endeavors of good people doing good work. It arises from efforts to achieve the most basic goals of every business – producing, delivering, selling, marketing, servicing, and more with speed and efficiency.

The bottom line: innovators must do no harm to the organization’s existing capabilities.